To encourage less-favoured regions to invest in innovation and technological development with a view to reducing the lag in their development and enhancing their competitiveness. To encourage exchanges of experience and best practice in these areas by supporting in particular the creation of inter-regional thematic networks.

2) ACT

Communication from the Commission "The regions and the new economy" - Guidelines for innovative actions under the ERDF in 2000-06 [COM (2001) 60 final - Not published in the Official Journal].

3) SUMMARY

In March 2000, the Lisbon European Council set Europe the target of becoming the most competitive and dynamic knowledge-based society and economy in the world. However, there is a wide gap between regions in the fields of innovation and RTD (research and technological development) and in the level of use of the new information and communication technologies. This gap calls into question the principle of economic and social cohesion and balanced polycentric development at European level. Thus, to ensure that the competitiveness of the least-favoured regions is rooted as solidly as possible in their capacity to innovate, the Union is encouraging them to design and implement policies based on knowledge and information. The aim of such policies is to create high-quality jobs likely to foster sustainable development.

Based on Article 10 of the Regulation on the European Regional Development Fund (ERDF), innovative actions in 1994-99 supported 350 operations relating to eight different themes: new sources of employment, culture and heritage, spatial planning (Terra), urban pilot projects, internal and external interregional co-operation (Recite II and Ecos-Ouverture), promotion of technological innovation (RIS and RTTs) and the information society (RISI I and II). This initial experiment was needed as a laboratory for experimenting with new ideas for assistance and organisational methods. It brought about new public-private partnerships, forged direct links between the regions and the European Union and stimulated interregional cooperation both inside the Union and with the applicant countries. Moreover, it provided experience which has shown how relevant the regions can be in terms of promoting innovation and contributing to the general debate on innovation in regional policy.

The Commission is continuing its action in 2002-06, and innovative actions have been included in the scope of the general provisions on the Structural Funds. 0.4 % of the ERDF's annual allocation is earmarked for these measures, no more than 6 % of which is to be devoted to sharing experience, creating networks and organising competitions to reward the best projects.

GENERAL PROVISIONS

The regions eligible for innovative actions in 2000-06 under the ERDF are those which are also eligible in whole or in part under Objectives 1 or 2 of the Structural Funds. A complete list of these regions, at NUTS level II in the Eurostat nomenclature, is given in Annex A to the Commission communication. The entire region is eligible for Community assistance in each case.

Innovation is by its very nature closely linked to the idea of risk and change. The innovative actions help the regions to cope better with the uncertainty arising from technological and socio-economic change. As a laboratory for experimenting with innovative development methods, the prime aim of innovative actions in the long term is to influence the quality of the assistance provided by Objectives 1 and 2 of the Structural Funds (i.e. the "mainstream"). At the same time, these actions aim to exploit to the maximum the synergies between regional policy and other Community policies, particularly those which help to reinforce the spirit of enterprise and innovation, implement the e-Europe initiative and encourage the creation of a European research area.

The new generation of innovative actions comprises three strands:

part-financing of regional programmes of innovative actions based on three strategic themes;

accompanying measures: support for exchanges of experience and the creation of interregional networks;

organisation of competitions aimed at identifying and developing best practice.

A: Part-financing for regional programmes of innovative actions

Regional Programmes of innovative actions

To ensure simple and transparent implementation, the Commission has opted for an approach by programme rather than by individual project, as was the case for innovative actions in 1994-99. The general provisions governing the implementation, control, monitoring and evaluation of the Structural Funds also apply to the regional programmes of innovative actions.

From 2001 to 2005, no later than 31 May of each year, the competent regional authorities submit their draft programme of innovative actions directly to the Commission. The programmes may run for no more than two years and the same region may receive Community assistance no more than twice. The competent authorities may propose a second regional programme only after the Commission has approved the first one in the light of activity reports.

Each programme proposal must contain a strategy agreed between the regional partners and covering one or more of the three strategic themes described below. As a rule, programmes are no more than 25 pages long and contain the following: a description of the region, identifying its strengths and weaknesses; the objectives to be attained and the strategy to promote innovation; the types of operation to be funded (studies, pilot projects, participation in networks, technical assistance, etc.) and the timetable for implementation; theirimpact on the ground; the groups targeted by the operations; the implementation structures (managing body, paying body, steering committee); a description of the control, monitoring and evaluation systems; the financing plan detailing the public and private contributions; a description of the partnership set up (parties involved and consultation procedure); information and publicity activities to promote the programme, targeting final beneficiaries and the general public.

The Commission appraises the programmes for part-financing on the basis of the following criteria: quality of the proposal (clarity and innovative nature of the strategic approach); potential influence on programmes under Objectives 1 and 2 (effect on modernisation and diversification of the regional economy, the creation of high-quality long-term jobs, sustainability); cooperation with the managing authorities for the main programmes under the ERDF; commitment and quality of the partnership (ability to enlist the public and private sector, quality of the information and consultation process); synergy with other EU policies and fields of Community interest (research, information society, entrepreneurship, the environment, rural development, equal opportunities).

Community part-financing of regional programmes of innovative actions ranges from 300 000 to 3 million. The port-financing rate is generally 50 % for regions eligible in full or in part under Objective 2 and up to 80 % for Objective 1 regions.

Three strategic themes

For 2000-06 the Commission decided to reduce the number of strategic themes to three:

Regional economies based on knowledge and technological innovation,

e-EuropeRegio: the information society at the service of regional development,

Regional identity and sustainable development.

These strategic themes are consistent with the new Structural Fund guidelines adopted by the Commission for the programming of Structural Fund assistance in 2000-06.

Regional economies based on knowledge and technological innovation: helping less-favoured regions to raise their technological level

A substantial technology gap still divides the advanced and less-developed regions in the field of RTD. Facilitating cooperation between the public sector, research establishments and firms, particularly small and medium-sized businesses (SMEs), should therefore be given priority. Here are some examples of possible measures:

creating and reinforcing cooperation networks between firms (SMEs) or groups of firms, research centres and universities, training organisations, financial institutions and specialist consultants;

staff exchanges between research centres, universities and firms;

disseminating research results and technological adaptation within SMEs;

support for incubators for new enterprises which have links with universities and research centres;

use of new financial instruments (venture capital) for business start-ups.

e-EuropeRegio: the information society at the service of regional development

The e-Europe initiative is designed to provide on-line access for all citizens (households, businesses, schools and administrations) and to foster a spirit of enterprise that encourages the funding and development of new ideas in the field of technological innovation. The initiative must also ensure that the entire process is geared towards social integration and builds social cohesion.

The less-favoured regions need to take full advantage of the opportunities offered by the information society and new technologies where the productive sector, public services and inhabitants' individual needs are concerned. Consequently, through its powerful networking effects, the information society can contribute to the geographical and economic opening-up of these regions and help them capitalise on their assets.

With regard to the "e-EuropeRegio" theme, the regional programmes of innovative actions cover the following areas:

establishing innovative strategies and experimenting with advanced digital technology for the benefit of specific areas such as rural, remote and otherwise isolated areas;

improving digital and mobile services for young people, the elderly and the disabled (e.g. public Internet access points);

encouraging SMEs to include electronic commerce in their development strategies and to find suitable ways of training their employees;

creating and developing specific areas for experimenting with innovation.

3) Regional identity and sustainable development: promoting regional cohesion and competitiveness through an integrated approach to economic, environmental, cultural and social activities

With ever stiffer competition between the regions to attract and create activities conducive to sustainable development, innovative actions are helping the regions to develop their specific strengths. These comparative advantages vary widely: they may be social (a highly-qualified population or specific skills), cultural (heritage, cultural diversity, local traditions, cuisine), geographical or environmental (preserving the ecosystem, quality of the climate).

Under this third strategic theme, regional programmes of innovative actions recommend the following fields of action:

assistance for micro-companies in the craft or traditional handicraft industries aimed at improving their technological awareness;

assistance for SMEs wishing to benefit from research activities in their region;

B: Accompanying measures: support for exchange of experiences and the creation of interregional networks

The European Commission strongly encourages the regions implementing innovative actions to exchange experience and best practice among themselves, in particular by creating networks. To achieve this, the regions concerned have two options:

Regions wishing to participate in networks (or any other form of exchange of experience) either as a participant or as a lead partner may include a specific action for this purpose in their proposal for a regional programme of innovative actions. They should set aside between 1 % and 3 % of their total budget for this purpose.

Groups of a minimum of five regions from at least five Member States may submit specific networking programme proposals to the Commission, appointing one region as the lead partner to submit the proposal. Programme proposals must reach the Commission no later than 31 May each year until 2004. The duration of programmes may vary depending on the proposals but they must be completed by 31 December 2006.Regions may participate in one or more specific network programmes but may act as a "lead partner" in only one programme at a time. New members may join a network, provided that this does not involve an increase in Community part-financing, which may not exceed 50 % of the total budget of the programme.The specific network programmes must contain the following information: a description of the actions planned (conferences, seminars, study trips, websites, newsletters), preferably based on only one of the three strategic themes; a detailed work plan and timetable for implementation; links with mainstream Structural Fund programmes; the bodies responsible for implementationand management (the lead region, managing body and paying body); practical arrangements for exchange of information and cooperation between the partners; financing plan showing the different public and private contributions.

Regions wishing to establish specific measures of interregional cooperation involving regional innovation which go beyond networking are invited to submit an application for part-financing under the Community Initiative Interreg IIIC, which aims to stimulate cross-border cooperation in general and interregional cooperation in particular.

C: Organisation of prize competitions

In 2000-06, the Commission will publish two announcements of competitions in the Official Journal and on the Regional Policy DG's Inforegio site relating to the strategic themes.

The regional authorities in the eligible regions should nominate the project which they regard as the most innovative among those meeting the criteria. A prize jury of experts will be set up to select the best projects.

REPORTING

From 2002, the Commission is to present an annual report to the European Parliament, the Committee of the Regions and the Economic and Social Committee on progress with innovative actions.

4) implementing measures

Consult the regional programmes of innovative actions adopted by the Commission on the Regional Policy DG's Inforegio site.